Using Micro-Grants to Fight American Homelessness

“When we opened the foundation in 2008, our thought was to do work on education,” recalls Barb Miller. “We had been doing work with a low-income school district in Chicago’s north suburbs when that work started pointing us toward a greater need—we were shocked to learn that the district had programs for 150 homeless students who were receiving before and after school care as well as meals.

Because day shelters are only open at night beginning at 6:00 p.m. and only from October through May, the schools were basically functioning as homeless shelters.

These kids were struggling with issues that almost made their education a secondary concern.”

How could a family foundation hope to make a dent in a problem as daunting and pervasive as homelessness? A chance encounter provided the answer. “Our temple had won an award from United Way for our work with the school system and I happened to meet someone from Prairie State Legal Services, a legal aid society, who attended the award ceremony,” Barb recalls. “I asked the attorney, ‘How can we help?’ and she said that what she needed most for her work was an emergency fund. She explained that the legal system can only take people so far and that a significant number of her cases could be resolved with just a little financial support—for example, a family member who could provide cash for a one-time, discrete problem.” Barb agreed to provide that kind of support through her foundation, making the first grant in late 2008.

As Barb discovered, in today’s economy these “discrete, one-time problems” had the potential to plunge even stable working families into crisis, often resulting in homelessness. “Many of our foundation’s grantees are people who are struggling but otherwise doing fine,” Barb explains. “Our typical client is a single mother who has a job, some sort of assistance for housing or subsidized housing, and perhaps receives food stamps. Then something happens—the car breaks or a child gets sick and the mom has to miss work for a couple of days —and then falls behind on a gas or electricity bill.”

What ought to be a temporary setback can quickly snowball into a full-fledged disaster. “If she can’t pay that utility bill, then pretty soon she’s looking at a five-day eviction notice,” Barb says. “Not only will she lose her subsidy for gas and electric, but she’ll also lose her subsidized housing. In Lake County, where we do a lot of our work, the waitlist for Section Eight Housing is eight years long; in Cook County, it’s twenty years.”

To prevent the downward spiral, the Millers put her foundation to ingenious use: With a one-time grant of less than $1,000, The Barbara and Stephen Miller Foundation intervenes at the crisis point, enabling families to stay in their homes. “If we fix the car or pay the utility bill, we’re not up against a five-day eviction notice,” Barb says.

The foundation also works to lower the financial barrier to housing. “People in subsidized housing may be paying a quarter of the market rate for rent, but the landlord can still charge full-market value for the security deposit and may legally charge up to a month-and-a-half of market-value rent for that deposit,” Barbara says. “They don’t have money for that deposit. That might be the only barrier to someone being in a stable situation—they have the voucher, they’ve identified a place to live, but they can’t move because of the deposit. If we help, they have access to a stable housing situation.”

The foundation’s work has produced astounding success rates. In the past two years alone, the foundation has helped 109 people and achieved lasting impact. Follow-up reports indicate that after one year, only six percent of the grantees were once again unstable.

Although Barb Miller confines her work to the local community, she’s convinced that the foundation’s model could be replicated in other parts of the country. “As result of a recent webinar we gave with Foundation Source, I’ve already talked to a handful of other people interested in doing this kind of work in their communities,” Barb reports, “and two of them have started emergency funds.” At some point, the data collected by The Barbara and Stephen Miller Foundation might be used to inform government agencies how to spend their dollars wisely.

So, how did a family foundation accomplish all of this? The secret is partnerships and one in particular got the ball rolling: “We came to Foundation Source with this idea for an emergency fund and asked how to do it,” Barb says. “Foundation Source helped us structure the fund. They set up the application process, gave us the mechanism to grant to individuals, and dispersed the payments.”

With the basic structure and administration in place, Barb was able to work with community-based partners including legal aid societies, Illinois township governments, and a few social agencies such as Catholic Charities to identify grantees and approve the applications. “I’m the only one running the foundation,” Barb explains, “but we’re able to help a large number of people because we piggyback on the staff of our partners. Why would we try to find and vet the applicants when there are organizations with experts who do this every day?”

Perhaps not surprisingly, Barb Miller intends to take her work to the next level through even more extensive use of partnerships: “The next step is networking to develop a group of like-minded family foundations interested in issues in our community,” she says. “Lake County is an interesting environment where we have some of the country’s wealthiest suburbs as well as pockets of severe poverty that lack social services. I’m putting together a group of family foundations to look into the issues here and figure out how family foundations can help.”

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